European Telecom calls in receivers

Monday 13 May 2002 23:00 BST

MORE than 200 jobs at European Telecom are in danger after the firm asked to be placed in administrative receivership. The mobile phone distributor blamed 'continuing losses' in its main business for the move.

European Telecom has been trying to move into the wider telecom logistics market after being hit by competition in its core mobile phone operation. It has been in talks to sell the distribution arm since January when it posted losses of £9.5m for the six months to 30 September.

In a statement to the Stock Exchange, the group said it had been unable to conclude the sale 'within an acceptable timeframe'. It added: 'The company has been left with no option but to ask its lenders to appoint administrative receivers.'

More than a hundred jobs have been lost at the group in the past year as its fortunes have tumbled in line with the rest of the telecoms sector. A spokesman refused to comment on what may happen to the 200 remaining staff, employed across sites in Waltham Abbey, Slough and Godmanchester, Cambs. He added the AIM-listed group's overseas operations were not affected as they had their own 'local banking arrangements'.

Its statement followed the suspension of its shares at 2.875p, giving it a market value of £3.62m. The shares peaked at 477 1/2p in 2000. Results earlier this year showed debts had been cut to £12.9m from £21.1m through asset sales and a share placement. But revenues fell 31% to £102m.